Four Letters. Infinite Potential.

Strategic Planning Must-Haves That Are Often Overlooked

In today’s environment, neglecting these key business strategies can negatively impact long-term planning and performance
By Keith Hughey, Senior Consultant

As changing member service expectations, shifting workplace demographics and new technologies reshape the financial services landscape, maintaining focus on strategies that position your credit union to remain competitive in the marketplace requires looking beyond the initiatives that are typically included in a strategic plan. 

Needless to say, on-going attention to growing both your member base and market share are crucial. We can add to that making sure you have the right products in place, the technology to provide the proper support and the right number of branches in the right locations to meet your member service needs. These are all fundamental for preserving a strong organization. 

However, it is also essential to maintain quality leadership and establish a strong connection with your community. It is no less important to realize that – in addition to excellent member service – it takes profitability to grow and continue to provide value to your members in order to remain viable. By including these initiatives in your strategic planning conversation, you can maintain a more efficient institution that has the resources necessary to succeed far into the future. 

Ensure uninterrupted, quality leadership with a pro-active succession plan 

While developing and implementing a succession plan is an essential element of maintaining long-term leadership depth, most institutions don’t begin this process until a retirement is imminent or there is a loss at the leadership level. When such a gap in leadership occurs, a succession plan can have critical implications for a credit union, from a continuity and regulatory perspective, as well as regarding its ability to reach its strategic goals and objectives successfully.

As Baby Boomers continue to reach retirement age over the next several years, their departure from leadership roles is expected to have a profound influence on organizational leadership. Also, as the economy is expected to improve and more financial institutions are starting to hire again, younger employees may be willing to test the job market if they have been staying put due to lack of other potential opportunities. 

Implementing a succession plan that identifies management potential within the organization and provides a path to expanded responsibility and opportunity for those employees who possess leadership qualities will allow you to avoid gaps in leadership. This will also help to create a workplace environment where employees feel valued and, in turn, are more committed to making the institution successful. 

If you don’t believe current employees have the qualities and skills required to lead the organization, establish a relationship with a professional recruiting firm before you actually need those services. This will give you time to develop a partnership with proven professionals who will get to know your organization, its strengths and specific needs, and to understand the exact talents and qualities you are looking for in filling key positions – from senior management to contract positions. Then, whenever you need access to the finest talent for any managerial or leadership function, you can expect a smooth, successful hiring process. 

Strengthen community relations by matching your board with charter demographics 
If your credit union has shifted its charter from a single SEG-based field of membership to a community focus, it is essential that members of the board of directors reflect the demographics of the community at-large. It is a natural tendency within an organization to recruit board members who have a similar background and philosophy as the credit union’s board members have had in the past. However, failure to consider the expectations and needs of a new community field of membership is a strategic oversight that could lead to unintended consequences when members of the community refuse to accept the credit union as their own. 

And while there are currently no specific requirements for board membership, efforts are reportedly underway within the industry to increase board diversity to represent the demographics of the community. 

In an article earlier this year in CU Times, NCUA Chair Debbie Matz stated, “Boards are most effective when attuned to the needs and goals of all their members and when they reflect the full range of experiences and perspectives of those members.” She continued by encouraging greater board diversity – including women, minorities and other under-represented groups – to promote smarter business practices, expand the pool of future leaders, build a more effective workplace and inspire greater confidence among credit union members. 

From a strategic planning perspective, identifying, attracting and developing board members who represent the community – who also have the right technical and leadership skill sets to help the credit union succeed – can create an environment where members of the charter community feel accepted and supportive of the organization. 

Train employees on cross-selling products and services to boost profitability 
Over the years, credit unions have become the experts when it comes to providing members with the best possible service. In many cases, this is what has enabled credit unions to survive in highly competitive markets. However, with changing economic and regulatory conditions, credit unions must shift their focus toward accepting that they have to be profitable to keep step with the competition and have the resources necessary to continue to provide members with the services they want and need. This requires charging competitive fees for the services provided and keeping a focus on managing costs. 

In most cases, credit union leadership is aware of this reality. However, for the rank and file member-facing employees, this concept conflicts with what they have come to understand and practice as the credit union way of doing business. 

Changing such long-held beliefs often requires a reorientation to help employees understand the need to augment credit union capital through earnings. Following this with sales training will provide staff with the tools they need to gain confidence in their ability to explain products and services to members, and to effectively identify cross-selling opportunities. By incorporating this business model into your long-range plan, you will be in a better position to provide a more full-service option for members – which will not only bring in additional business but is an effective way of maintaining the credit union’s reputation of providing more of what members need. 

Maintain a nimble strategic focus to remain relevant
It’s no secret that consumers have many options for obtaining financial services today. And as the financial services industry continues to change, credit unions must maintain the ability to adjust to the transitions in the labor force and community diversity, while establishing a business model that incorporates the idea of profitability into their service mantra. Incorporating these strategies into your long-range plans can help you to build a stronger organization that has the tools necessary to take on the challenges that lie ahead.

About JMFA

JMFA is a leading provider of profitability and performance-improvement consulting. For more than 35 years, JMFA has been recognized as one of the most trusted names in the industry, helping financial institutions reach their goals. JMFA is recognized for earnings enhancement and expense control programs, executive placement, as well as product, service, pricing and technology-improvement consulting. Simply stated, JMFA’s programs and services are designed to increase income or reduce expenses. JMFA is proud to be a preferred provider for performance-enhancement consulting services among many industry groups.


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